Time Warner's Tiers May Prompt New Legislation

Time Warner's planned implementation of a bandwidth cap on broadband usage has received negative reactions nationwide and now may be the impetus of new legislation limiting such measures.

U.S. Representative Eric Massa of New York was none too pleased when Time Warner announced that it would be rolling out the new tiers in his district. Massa said he would draft new legislation to prohibit Internet Service Providers from implementing unfair tiered pricing structures, especially in areas where they hold a monopoly.

"I am taking a leadership position on this issue because of all the phone calls, e-mails and faxes I've received from my district and all over the country," Massa said in an April 10 statement. "Time Warner has announced an ill-conceived plan to charge residential and business broadband fees based on the amount of data they download. They have yet to explain how increased Internet usage increases their costs."

Time Warner's Chief Operating Officer Landal Hobbs subsequently released a statement saying, “We realize our communication to customers about these trials has been inadequate, and we apologize for any frustration we caused. We’ve heard the passionate feedback, and we’ve taken action to address our customers’ concerns."

So far, the only action Time Warner has taken is to say that the most any customer will ever pay for internet usage is $150.00 a month. However, this gesture is meaningless considering customers (where the tiered plan trials are not being tested) currently have no usage cap on a $40 plan.

As we covered in a recent news article, Time Warner's new tiered plans would have bandwidth caps of 5GB, 10GB, 20GB, 40GB, and 60GB with a new Turbo Package capped at 100GB. The plans would cost from $40 to $75 a month with any overage charged at $1 a GB up to a maximum total of $150 a month.

"Time Warner's decision has the potential to more than triple customers' current rates, and I think most families will find this to be too taxing to afford," Massa said. "Time Warner believes they can do this in Rochester, N.Y.; Greensboro, N.C.; and Austin and San Antonio, Texas, and it's almost certainly just a matter of time before they attempt to overcharge all of their customers."

"At a time when millions of Americans have lost their jobs and businesses are struggling, I am compelled to fight against additional, unnecessary burdens placed on my constituents," Massa said.

No details of the proposed legislation have yet been released, but Massa said it would also include provisions aimed at increasing competition in areas currently serviced by only one provider.